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Thursday, May 03, 2012

Dixon Comptroller Allegedly Stole $53 Million

Rita Crundwell

I'm not sure how a city comptroller of a relatively small city could manage to steal $53 million in taxpayer money over a 20-year period before anyone noticed something amiss, but that's exactly what federal investigators are accusing Dixon, Illinois long-time comptroller Rita Crundwell of doing. Dixon is the hometown of former President Ronald Reagan and has a population of less than 16,000 people. The government has produced a laundry list of assets Crundwell, who had been the city's comptroller since 1983, is accused of acquiring with the stolen funds, including the following:

Two residences and the horse farm in Dixon

A home in Englewood, Fla.

A $2.1 million luxury motor home

More than a dozen trucks, trailers and other motorized farm vehicles

A 2005 Ford Thunderbird convertible

A 1967 Chevrolet Corvette roadster

A pontoon boat

Approximately $224,898 in cash from two bank accounts, and other assets allegedly purchased with fraud proceeds

The government says she covered her tracks by creating fake invoices for what appeared to be legitimate expenses but instead was transferring the funds to a personal bank account she controlled. Illinois' budget woes has often led to the state to distribute revenues due to local governments late so she often used that excuse to the mayor and council in explaining why other funds weren't available.

A local newspaper editorial complains that U.S. Attorney Patrick Fitzgerald only indicted Crundwell on a single count of wire fraud, which pales in comparison to the charges Fitzgerald brought against former Illinois Gov. Rod Blagojevich, who wasn't accused of stealing a dime from taxpayers:

Why, then, was Crundwell indicted on only one count of federal wire fraud –
the same charge that prosecutors announced on April 17, the day Crundwell was
arrested?

Inquiring minds would like to know.

The wire fraud charge involves a mere $175,000 in city funds which,
prosecutors say, Crundwell caused to be wired from a bank in Minnesota to a bank
in Ohio.

The charge is serious. It carries a maximum penalty of 20 years in federal
prison and a $250,000 fine.

In the face of the overwhelming evidence released by prosecutors, however,
that single, solitary charge against Crundwell appears underwhelming by
comparison.

We suspect the prosecution has a strategy in mind here. It would appear that
additional charges could be filed at the drop of a hat.

But the situation still may not sit well with Dixon residents and others who
know that Crundwell is free on her on recognizance, possibly because of the lack
of additional charges against her.

Some locals are blaming the failure to catch Crundwell until she had stolen so much money on the form of municipal government Dixon has. The city has a part-time mayor and commissioners who act both as administrators and legislators. Apparently, the commissioners, who are the equivalent of the councilors, divide up responsibility for managing the different city departments among themselves. Some are urging the city to adopt a city manager approach to running the city, while others think the mayor and the commissioners should accept the blame for allowing the massive embezzlement scheme to occur. The city must have been electing some pretty dim bulbs as mayor and commissioners over the past 20 years not to notice this much money missing from what should be a relatively small annual city budget of $9 million to manage. I'm not sure how they thought she was capable of building the largest horse breeding operation in the nation on her city comptroller's salary.

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